This year’s IPO market is breaking new records and the year isn’t even over yet.
Renaissance Capital expected 375 deals to close out the year, with raises of around $125 billion--a figure that blows away the dot com craze.
From $2-billion valuations all the way up to over $100 billion, these three IPOs could happen by the end of this year, for better or worse from an investor’s perspective:
On Monday, the sustainable shoe brand let it be known via regulatory filing that it’s targeting a $2.2-billion valuation in its planned IPO, for which no date has been publicly set and which speculation has it that it will list on the NASDAQ. Allbirds will offer up 19.2 million shares at $12-$14 per share, which would bring in nearly $270 million.
The eco-friendly shoe brand sounds enticing, but it’s not profitable. It’s hoping that shoes--with a green label--will produce the same level of speculative interest and patience that investors have shown for promising tech. But this isn't tech; it’s footwear, and Allbirds might be flying too close to the sun on this one.
The company has 27 brick-and-mortar stores, and sells the bulk of its products online.
The selling point here is apparently the company’s future plans. The IPO is raising money to put Allbirds in shopping malls and to significantly expand its brick-and-mortar presence.
The Monday IPO valuation announcement also coincides with revelations of Allbirds Q3 earnings, which saw it take a loss of at least $15 million--more than double its loss in the same quarter last year.
The holiday shopping season is a good time to test investor interest in a potential Christmas-list product with a green bent, but it’s also asking investors to take a big leap of faith on a non-profitable company that’s not producing ground-breaking technology.
#2 Rivian Automotive
Far more exciting is the $80-billion valuation for Amazon-backed Rivian Automotive, which is expected to go public closer to the end of this year.
This EV pickup truck startup is eyeing a valuation that’s only $3 billion shy of giant General Motors market cap.
More importantly, this is an attempt to truly Americanize EVs and make them more desirable to the masses. There’s nothing more American than the classic pickup truck. As for the Rivian’s RiT price tag of $70,000 … it’s steep.
For comparison, Ford trucks range from around $25,000 to upwards of $50,000. But GMC Sierra trucks can carry a price tag of over $67,000.
The Rivian isn’t very competitive in that respect, but it’s not entirely out of the ballpark, and filling a truck’s gas tank isn’t cheap these days, so it might be a good time to go public with this “all-American” idea.
The clincher for investors is the fact that Rivian has already sold Amazon 100,000 vehicles in pre-order, even if the ongoing chip shortage has delayed production a bit.
With an even higher valuation of $95-$100 billion, payment processing giant Stripe is expected to go public later this year or early next year, and it’s one of the most-anticipated IPOs out there.
In fact, it might end up being the biggest IPO ever. And it’s highly likely that if this IPO waits until early 2022, it’s valuation could be well over $100 billion.
Unlike Allbirds, or even Rivian, no one is questioning the market demand for Stripe’s payment processing services because it’s all tied to soaring e-commerce.
Stripe is already the most valuable startup in the United States, but the competition is huge, as well: It includes Paypal and Square.
The San Francisco-based company was founded in 2009, and continues to expand into new areas, including Stripe Tax (for businesses collecting sales taxes) and online verification tool Stripe Identity.